(Reuters) -Carnival on Monday forecast third-quarter adjusted profit marginally below estimates as the cruise operator battles higher marketing and labor costs.

The company's shares, which have surged nearly 80% in the past few months on resurgent demand for cruises, dropped about 6%.

Carnival has increased marketing spend since Josh Weinstein took charge as CEO in August last year and attracted new customers, as it seeks to gain an edge over its competitors such as Norwegian Cruise Line Holdings.

Cruise liners have seen labor costs rise as they have had to add staff to manage higher occupancy levels at a time when a strong labor market has driven up wages.

Carnival, however, cut its annual loss forecast banking on higher ticket prices and a steady demand for cruises in the face of sticky inflation that has otherwise forced consumers to reduce discretionary spending.

U.S. customers including the younger population have been shelling out money on novel services such as cruise travel, prioritizing experiences over spending on non-essential goods.

Carnival said booking volumes for the second quarter scaled a new peak, shattering record volumes seen in the first quarter.

The company said cash from operations and adjusted free cash flows were positive in the second quarter of 2023, with both expected to be positive during the second half of the year.

Carnival forecast third-quarter adjusted profit per share between 70 cents and 77 cents, whose mid-point is below analysts' average estimate of 76 cents, according to IBES data from Refinitiv.

The company now expects adjusted annual loss per share between 8 cents and 20 cents, compared with its earlier forecast of a loss per share of 28 cents to 44 cents.

Carnival also beat second-quarter revenue estimates and posted a smaller-than-expected loss.

(Reporting by Juveria Tabassum and Ananya Mariam Rajesh in BengaluruEditing by Vinay Dwivedi)